That Worrisome China-Iran Deal

by Hugh Fitzgerald

While the Biden Administration was preoccupied with passage of the $1.9 trillion stimulus package, the attack on the Capitol, racial injustice, and suchlike domestic considerations, Iran and China – two of America’s three most dangerous enemies – were getting together to fashion a 25-year alliance that strengthens Iran’s negotiating position with Washington. A report on what this agreement includes, by the Israeli analyst Dan Shueftan, is here: “Iran-China deal is cause for concern,” by Dan Schueftan, Israel Hayom, March 29, 2021:

While the[Israeli] public was busy with the domestic political imbroglio, a strategic threat that could threaten Israel’s very existence is developing. If the Iranian-Chinese alliance reaches its full potential, the Middle East could once again be dragged into a new cold war between superpowers. Soviet support for late Egyptian President Gamal Abdel Nasser’s radical policies ensured him regional hegemony that threatened Israel for over a decade. The American attempt to placate the Egyptian leader only made things worse. Now, massive Chinese assistance to the radical Tehran regime could provide Iran support in its attempts to impose its hegemony on the region within the framework of another kind of cold war now developing between Washington and Beijing. Such Chinese support, along with US President Joe Biden’s conciliatory tone, could be the kind of strategic threat Israel has not seen since the 1973 Yom Kippur War.

In recent years, Israel has faced an escalating war with Iran in an attempt to prevent it from attaining the kind of power that would allow it to construct massive military infrastructure around its borders. Iran understands that only Israel can thwart its aspirations for hegemony. It has tried to deter Israel by threatening its population centers.

Israel has been bombing at will, with many hundreds of attacks, Iranian bases in Syria, in what is known as Operation Chess, in order to prevent the transfer of precision-guided missiles to Hezbollah. This has kept Iran from successfully completing a key part of its “Shi’a crescent,” which is intended to extend from Yemen, with the Houthis, and through Iraq, with the Kata’ib Hezbollah militia, all the way, through Iran’s ally Syria, to Lebanon and Hezbollah. Hezbollah is a threat, with its 150,000 missiles, to Israel, but it only becomes a mortal threat if It manages, in the view of Israeli military analysts, to possess about 1,000 such missiles. So far the Israelis believe that their bombing in Syria has kept Hezbollah from acquiring even 100 of the precision-guided type.

A majority of Arab regimes have also come to understand that only Israel is strong enough and determined enough to stop the ayatollahs. While the US is more important, it is less reliable and determined. These Arab states were appalled by former US President Barack Obama’s approach but temporarily encouraged by that of his successor Donald Trump. Under Biden, they have begun to worry once again. That is the meaning of the Abraham Accords. In many ways, the old familiar Israeli-Palestinian conflict has been replaced by an Arab-Israeli coalition that opposes Iran and Turkey’s President Recep Tayyip Erdogan and is suspicious of the new US administration.

The Sunni Arab states most threatened by Iran – Saudi Arabia and the United Arab Emirates — recognize that while America is militarily stronger than Israel, it lacks Israel’s determination, skill, and ingenuity to foil the Iranians. The Gulf Arabs have been alarmed by the mutability of American policy; they were heartened by Trump’s pulling out of the 2015 nuclear deal and his reimposition of sanctions, only to be greatly disappointed when Biden announced his intention to rejoin the J.C.P.O.A., and to lift those sanctions as soon as Iran recommitted to the deal. Israel, on the other hand, remains resolutely against the 2015 deal, is lobbying hard in Washington to keep Biden from rejoining it, and is doing everything it can on its own to set back Iran’s nuclear project. Think of how much the Israelis have managed to achieve in that respect: the Stuxnet computer worm in 2010, that caused 1,000 centrifuges to speed up and destroy themselves; the assassination of four nuclear scientists, from 2010 to 2012; the locating and removal of Iran’s entire nuclear archive in 2018; the sabotage of the new centrifuge plant in Natanz in 2020; the assassination of the scientific mastermind of the nuclear project, Mohsen Fakhrizadeh that same year. The Gulf Arabs have been impressed, and are grateful for Israel’s ingenuity and daring.

Trump’s determined stance offered a comprehensive response to the Iranian challenge. It did not relate merely to the nuclear threat. A focused response in the form of the 2015 nuclear deal, which effectively bolstered Tehran’s position, does not effectively meet the challenge. A zero-sum game is required that seeks to harm Iran mainly in the economic arena and deters it from conflict by ensuring US support for Israel’s military actions against Iran. When Iran engaged in numerous provocations against Saudi Arabia’s oil industry, Trump responded by assassinating the head of the elite Quds Force, Qassem Soleimani. Tehran didn’t dare offer a suitable response to the painful and humiliating blow it was dealt. But the main tool was sanctions that hit Iran’s economy to such an extent that, had they been in place for another four years, the ayatollah regime would have been unlikely to survive.

We are now witnessing something reminiscent of what we saw under the late US President Dwight Eisenhower: deep economic and military involvement by a superpower competing with the US and a conciliatory response from Washington.

China’s foreign minister signed a 25-year strategic deal, first drawn up during Chinese President Xi Ji Ping’s 2016 visit to Iran, aimed at increasing bilateral trade tenfold to $600 billion in 10 years. The deal will provide China with priority access to huge investments in Iranian infrastructure, banking, and communications. The agreement also allows for joint military exercises and military cooperation in the future. In return, Iran is set to provide China with vast amounts of oil and gas in the long-term at relatively low rates.

It is worth noting that China and Iran first drew up what has just become their current deal in 2016, but it was put on the back burner when Trump was elected President later that year. Given Trump’s strong animus toward, and suspicion of, China, the Chinese decided it was best not to further anger Trump, and a deal with Iran would certainly have done that. But when Trump was replaced by the pliant Joe Biden, the strategic deal, which is to last for 25 years, was finally signed. It has both economic and military aspects. China will be given “priority access” as an investor in Iran’s infrastructure, banking, and communications sectors. Trade between the two countries is promised to increase from $60 billion a year to $600 billion, most of it being Chinese goods sold to Iran.

Iran has one very important resource to supply to China. For the next 25 years, Iran has agreed both to guarantee a steady supply of oil and gas to China, and to sell both at preferential – i.e., below-market – prices. What this means is that the economic pressure that the Americans had exercised, in preventing the sale of Iranian oil, has now disappeared: China is a large enough customer to buy all of Iran’s oil production, in the event that Teheran is unable to sell some part of its production elsewhere. The deal also guarantees that Teheran will have access to large amounts of Chinese capital; China has agreed to invest $400 billion dollars in Iran over the 25 years when the deal is in force, and both countries have committed to a tenfold increase in bilateral trade..

This kind of agreement serves to effectively neutralize US economic pressure, seriously bolsters Iran’s bargaining position, and could herald a renewed Iranian effort toward regional hegemony. The rate of its realization and its characteristics depend crucially on US-China ties. This is a very important Chinese bargaining chip in the international area, one that was suspended under Trump and pulled out once again under Biden, with significant repercussions for Israel.

There is also a very significant military aspect to this deal signed by Iran and China that includes a commitment to military cooperation, with joint training, research, and weapons development, and intelligence sharing.

It is this last that has Israelis most concerned. “One of the most worrying clauses in the agreement between Iran and China is the intelligence sharing,” said Amos Yadlin, former head of Military Intelligence for the IDF and currently head of the Institute for National Security Studies. Yadlin said that with that clause about intelligence sharing, “China is putting itself in a place that, until today, it had not been before.”

“On a fundamental level, China opposes an Iranian nuclear bomb, but on the other hand, it is not helping to stop Iran,” said Yadlin. “Iran, too, needs the political support which China has to stop the United States from pressuring it.”

“The Chinese understand that the Biden administration is not the Trump administration, and they can be much more aggressive,” he added.

China commits to enhanced “military cooperation” with Iran in the future. What does this mean? Will China, as it is constantly upgrading its weaponry, and determined as it is to catch up with and in some weaponry possibly surpass the Americans, be able to supply advanced fighters to Iran, equal in performance to the American Stealth fighter F-35? Will it supply Iran with missile defense systems equal to those of Israel? Will China decide to help the Iranians with their nuclear project, or their ballistic missile program? Most worrisome, China has agreed to share with Iran its intelligence about the region, and especially about the Jewish state. The Chinese, according to the Israelis, have a spying operation in the Jewish state that targets Israel’s two largest arms exporters, Israel Aerospace Industries and the arms manufacturer Rafael, along with the company Elbit Systems. Now Israel must assume that whatever they find out, they will pass on to Iran.

For Israel, and its Sunni allies, this Iran-China deal is a terrible development. But with Biden in the saddle, all hat and no cattle, what did you expect?

First published in Jihad Watch.